tv Street Signs CNBC September 9, 2016 4:00am-5:01am EDT
peering lower. capital increase. shares in pub chain jb weatherspoon float higher. dedicates a large chunk of release to slamming the remain side of the brexit campaign. everyone from the establishment said it was going to be terrible. they've already been proven to be wrong. and as i've said in the release, it's now scare story two. >> happy friday everyone. stock europe 600 is down. plenty of risk today given the renewed nuclear test coming out of north korea. we didn't get the extension announcement from the ecb yesterday today. let's have a look.
german market down .30%. worth noting german exports fell 10% year on year. that is the biggest year on year decline since 2009. the ftse 100 down 2%. sector wise seeing the health care stock performing because of a downgrade. retail also underperforming. banks up 1%. in part because of the bank chatter, but come to that in just a second. last but not least, show you what's going on in oil prices. saw the big jump in yesterday's tradining session. crude up on that big draw down in inventories. that caught everyone by surprise. today we're seeing a little bit of profit saking brent crude at 49 .47. >> prime minster has told a french newspaper that greece needs a debt relief deal to get
back to census sustainable growth. too early to comment on greece's progress. while the president of group, urged athens to accelerate reforms. let's get out to julia chattily that joins us. hard to believe just when we thought brexit might be the biggest concern on those mind at the euro group meeting, here we are talking about greece once again. >> reporter: it's groundhog day. we're always talking about greece, particularly at these informal things held in the country hold tlg president. yes, sgrees going to be discussed today. they've already tried to preempt any real debate says we haven't done reforms, but we'll try to
get them done by december. still due from the last review. if they don't manage to get these reforms done, all the issues, privatization fund, loosening the labor market, these are things they've been tackling for months, not years. they're going to lose access to that money. all the euro zone nation haves to go through parliament and ratify it. the count down is on for them to achieve this. the problem is asking once again for some clarification on debt relief. he needs to be able the go to parliament and say guys we are getting one thing even if we are giving over something else. italy, sorry, greece obviously going to be discussed here. as you mentioned there, brexit top of the agenda. i couldn't help thinking brexit has mask add number of bigger issues going on for the skrij countries here. whether it's through and the constitutional referendum on reforms later on this year, we've also got the italian banks
we chemocokeep coming back to. taking steps to capitalize their second largest bank. some of the conversations i've had behind the scenes here okay.t that's going to be remember you're talking about a country that only has one investment grade rating left from a rating agency. if they lose that, they lose access to testimony qe program. watch portugal. watch italy. spain doesn't have a government. as i've seen in the last 48 hours. ireland faces challenges with the government too. i think a lot of other issues brewing beneath the surface here, not only brexit. >> mario draghi keeps driving home the message that not everything can be done by monetary policy. it's up to the government to engage in fiscal polsz. will that be met with open ears in brock saliva today. >> referee: that is the
question. he put the ball firmly in the court of the individual nations here and policymakers to say guyhouse need to step up whether it's fiscal stimulus or structural he forms. germany response this morning amusing. when we look at who could take action here, the finger always points a germany. saying hang on a second, it's ecb policy that lead to a weaker euro that led to it will circle germany has. deaf ears i think in response to your question. >> all right. thank you for that one. certainly some questions over the member states have the will on that one. great seeing you. we'll be back to you later on. meanwhile, lerts bring in head of investment strategy. when you look at the action in the equity markets a little bit of disappointment following the
comments from draghi that he wasn't more dovish than expecting. are the markets right to be disappointed. >> i think in terms of our take of yesterday's ecb meeting it was very clear that qe extension would be a matter of when rather that if. the fact that mr. draghi indicated they are designating technical committees to look at details and also when you look at the growth forecast projection, they have not really been revised they're down significantly embedding further easing in the future. all of that are evidence in our point of view that qe extension is definitely under currents. why didn't they announce it yesterday. i think resilience in data or a lack of obvious contagion from the brexit referendum to the european data has been probably buying them time, making them a bit complacent around timing.
>> bearing those factors in mind, are you surprised what you've seen with european equity throws. coming a time where the u.s. fed is expected to start tight thng year, you might expect a bit of a reversal. that's not been the case. >> i think we talked a lot about uncertainty. in europe area over the next 18 months or so with the referendum. italy coming up later a potentially late november and also a series of elections coming up as well. i think investors are just not that certain about political stability and that's why they have been exiting european equities in size and this is the trend since the beginning of the year already. it has continued in august, even though underlying markets started to outperform. >> it's interesting that one area where investors have been flocking has been emerging market equities. to put this into perspective though, it's still a fraction of
the outflows we've seen. i believe they stand now at 150 billion dollars. is it too late to get in. is it too crowded in the emedical personneling market equity space. >> there's a question we're getting a lot from clients and investors. in our point of view it's not too late. both for equities and emerging market debt. we think a lot of the reasons that have been supporting emerging market momentum this year is structural in nature. if you think about the fed and the dollar, a lot of people focus on when they're going to hike. is it going to be september, december, we think december more likely. the path of rate hike is also important and if you look at where a markets are pricing towards the end of 2017, we have one rate hike being priced in. as a result of the work, talking about very gentle gradual rate hike pass. with a softer dollar, emergeing market can perform. with an equities based earnings turning the around as well which
in our point of view are meaningful and support the momentum. >> how do you investors and clients feel about commodities at this point. gold depending on what the dollar is going to do. oil sea sawing and springs up on any sort of speculation we get. is it too volatile for some of your investors. >> we need to differentiate commodities. dollar has been under pinning driver. specifically with regards to gold, we have been seeing steady inflows going into gold etfs year to date. recently momentum has been coming down. a lot of investors recognize there is merits to have ale diversifier in the portfolio. some people go to gold for safe haven. some go for inflation hatch. commodities such as oil it has
been a lot more volatile. been playing to supply and demand. >> thank you so insights this morning. just want to bring you the latest on deutsche bank shares. they've been charging ahead this morning. up more than 4% now if we can show you the chart there. we know the banking stocks in europe have been higher as well. deutsche bank up 3.2%. this is based on a report and manager j germany saying deutsche will pay a settlement in relation to u.s. mortgages. this is a bit of relief rally on part of investors hoping this chapter will close very, very soon. we know that litigation has been a huge huge headache and head wind for deutsche bank. the sooner we get clarity and closure on that, the better. deutsche up little more than 3%. meanwhile, commerce bank is
reportedly exploring a big move. >> i like that pronunciation. >> the second largest bank is looking to radically overall corporate banking business. unicredit is considering selli ining pion near investmen branch. the newspaper says it's part of a 10 billion euro increase. the ceo of banco monte dei paschi has resigned. the unexpected departure comes as the troubled italian lender seeks to raise 5 billion euros in additional capital. expected to remain in the his post until a successor is appointed. shares have lost 95% of their
value under his tenure. >> morelli is most likely to replace. previously worked with the struggling lender between 2006 and 2010. so he should probably know a thing or two about the bank. >> you would hope so. a lot of people saying this is a essential step before they try to tap capital markets. all of this happening while the bank of italy and ecb give the green merger. the deal is set to create third largest bank by assets. shareholders are still to vote on the tie up which was announced back in march. e-mail the show. address at "street signs" at euro. let us know whether you're feeling risk on, risk off on this friday. most of you are probably feeling risk off after the ecb in north
north korea has carried out it's fifth and largest nuclear test, detonating a bomb that was more powerful than the one dropped on hiroshima. north korea counter part was acting with quote, recklessness while president obama warned the test would be met with series consequences. north korea only jorl ally china said it opposed the detonation.
urging pin jing to check out the situation. endure for two or three months. the government unit also said bankruptcy is likely to increase the cost of imported agricultural goods from south korea. meanwhile samsung has requested court awe approval to remove from ships. august price inflation has risen, 1.3%. slowest pace since 2015. let's check on markets in asia. talking about chinese inflation before and you were talking about petitiigs. what's the connection here. i did. pork has been a major con tich went. less so, but still bears scrutiny. i'm always reminded what my good friend has told me. if you want to get a sense of
expectation, look at chinese pig stock. that's connection. right now the pigs seem so be behaving themselves. cpi seems to be stable. seeing signs of stabilization in the ppi number and factory gain as well. hard landings probably not the base case scenario. still stressing within the broader chinese economy because of the leveraging cycle. that's going to continue to remain a drag on growth. that's my take. largely agnostic about the data as they always are. over the course of the week, relatively stable. fractional gains. you were talking about north korea. certainly rattled sentiment out here. risk day. leader here down about 1.3%. i'd say heading into the weekend, folks are probably disinclined to lay major bet sboos the markets given the risks in the region.
given the rise in the go politics over here, but you've got to ask yourselves when you look at the negative interest rate world, when you look at the serp rate world, we've seen a lot of portfolio inflows. valuations are looking a bit stretched, but a lot of people saying the party has just got started. so many folks who do have the stomach for this volatility and go politics may view this as a buying opportunity. i think monday is going to important from a fed perspective. fmc voter and speaker will be speaking on monday. will lay the groundwork for dovish fed and dovish expectations or no move other the course of 2016. that's going to inform markets and set the direction in the short-term. as we stand as we close out the week, back to you. >> thank you so much for that. in terms of broker news,
deutsche bank has upgrated necessarily. upping the price target. saying there is margin upside and the mix is strong with limited reliance on price. optimism surrounding the senior management team continues to rise and this follows a previous upgrade coming from rbc capital market saying top pick in food manufacturing sector. in part because of the new chief executive is expected to improve shareholder returns. let's stay in the food sector. jd whether spo drkd wetherspoon jump. dedicated to slamming the remain side of the brexit debate. speaking first on cnbc, the chairman tim marten explained why. >> everyone from the establishment said it was going to be terrible. they've already been proven to be wrong and as i've said in the
release. it's now scare story two. scare story two, if we don't stay part of the market, all sorts of dire consequences will occur. i don't think that's true. the united states isn't in the eu, neither is australia, neither in japan. they all do very well. the key thing is democracy and keen so see that reserved and people not believe the scare stories. we don't want to be run by five unelected presidents from europe. a supreme court we don't control and a general increasing trend toward o tok si. ecb president came under criticism for failing to outline a clear plan should further stimulus in coming months prove necessary. for his part, draghi did turn
the spotlight to euro zone government for not pulling weight. >> the implementation of structural reforms needs to be stepped up to reduce structural unemployment and boost potential output growth inform euro area. structural reforms are necessary in all areas. >> determined to demonstrate independence and may lift rates against investors expectations. this according to jeffrey who will says he expects to central bank to raise rates at a time when markets are only assigning 40-45% probability to the outcome. the capital ceo warned the fed may be blowing itself up in pursuing such a policy. quick check of the currents markets. we're seeing euro dollar at 1 .1269. well off the levels we saw yesterday. when we saw thatle disappoint
over the lack of the extension of the qe program. we're still close to two-week highs for euro dollar and the u.s. dollar actually losing a little bit of strength this week on the back of disappointing data points for the week. actually tracking for a 1% loss. let's talk a little more about the fx markets with timen derek. why did he underwomen so much yesterday. not the fact he didn't mention any extension of tweaks. it was also his tone, wasn't it. >> had to fill an hour of a press conference saying nothing. he did a good job of it. we can argue as to why that's the case. i'd say that we all know that the ecb needs to do something more about the bond purchases. we know that the need to raise
the regulation because otherwise they're going to run out of bonds to buy before march, but we're going to fed meeting coming up we don't know exactly what's going to happen. we have a bank of japan coming up. we don't know what's going to happen. from his perspective, doing nothing until it becomes clearer the path of policy elsewhere makes sense. you don't want to go now and see the fed do nothing and the euro up. you have to do doing and be boring and actually he did a very good job of that. if you look at the performance of the euro, the biggest volatility in the last two years all come on the back of ecb meetings. here he was disappointing the market. so if he jobless he did it well in deed. i think he did that precisely. >> maybe that was his intention. let's talk about the fed a second. he made interesting comment saying maybe the fed is going to catch everyone by surprise. maybe they'll hike when only
40-45% of the market is expecting that. would the fed really do that? that's a huge risk. >> they could. i mean, quite clearly, everything meeting is a live meeting. we got through august without creating any volatility. did a good job. this is i would argue the most dovish fed i ever remember. you look at the incredibly slow pace we first talked about time and policy back in may of 2013. yes we pulled ck asset purchases. we had one rate hike. we were talking about other starts this year. why would they change the spots now. why going into the november meeting a particular in an election when you -- when the fed is becoming politicized. we know the comments donald trump has made about janet yellen. why would you do anything to disturb the situation particularly when you've got this nernt about the economy as well given the august numbers. they could go, but why. why not wait until december.
that's the most likely outcome. >> you say that, but mentioned announcement yesterday giving a speech on monday. seen as a dovish member. do you think markets are making too much of that when we saw the reaction in treasuries or could this be the signal trying to send ahead of that decision. >> if it is the signal, they don't have the space to do this. if you're going to start shifting expectations. you needed to start doing it a lot earlier. you needed to follow up at jackson hole and continue saying it, but they haven't done so. yeah, i think the market is overreacting. >> finally, what do you want to buy, what do you want to sell. >> i want to buy anything backed by a hard asset. i believe central banks will remain accommodative. i want to buy assets. >> timen derek, chief currency strategist. stay tuned for medical opinion more on the fed coming up.
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good morning and a very happy afraid. welcome back to "street signs." these are your headlines anchs showdown over greece. european finance minister meet for crunch talks. euro group president calls on athens to accelerate reforms as it waits for mail bailout money. world leaders condemn north korea for conducting largest ever nuclear test with united states and japan leading for calls for coordinated action.
korea trading sharply lower. unicredit leads italian credit lower. reportedly malls the sale of pine nearly holding. shares in wetherspoon flowed higher, but chairman tim martin dedicates to slamming brexit campaign. >> everyone from the establishment said it was going to be terrible. they've already been froouchb be wrong and as i've said in the release, it's now scare story two. >> let's get back to uk data points. look accident at construction output and that held up pretty well in the month of july. construction volumes were unchanged in july after a 1% drop in june. that is a smaller fall than the average 0.8% decline forecast in
a reuters poll. compared with a year earlier, volumes were 1.5% lower. that is the biggest drop since april 2013. a smaller decline than 3.2% that economists had forecast. slightly better than expected data in terms of the uk construction output front and let's have a look at sterling dollar once again. it has been rising of late. on the back of interpret than expected sentiment data. particularly the services pmi. 13292. pretty much unchanged on the day. simon, we're waiting for the trade figures out this morning. those are expected to have done a little bit better on the back of the weakness in the sterling, and, in fact, i think we've got them. >> if we can just wring the trade figures to. the july trade balance at negative. that compares to a forecast for negative 11.75 billion. we're looking at the uk trade
balance narrowing in july. when you look at the overall balance been revised to negative 12.20 in the overall when you look at the july global good forecasted around 11.8 billion. >> i just want to mention too a boe survey is showing the purr portion of british people who think the bank of england will raise rates has plunged a record low reflecting the bank's decision to cut costs after brexit vote. we have a lot of data points we just through at you. let's put this into perspective with economist. do you think mr. carney was right to justify dovishness on monday before parliament. he says he's focusing on the longer term impact of brexit. >> it's very easy sat here now to forget the power vacuum we have in the uk immediately following the brexit vote. mark carney could step up to the
plate cut interest rates signaling to the markets early on after the sloet he was going to cut interest rates and restart the quantitative easing program. we have to remember, of course, the uk remains in the european. we are not brexit. another two and a half years to go before the uk will leave the european union. a lot of the actions from the bank of england are trying to get ahead of the curve. >> there must also be some work to be done from the fiscal side and chancellor hammond poured water in hopes of a big infrastructure package. is that a big disappoint to you. >> he was testifying yesterday announced the 23 of november for the autumn statement. what he indicated wasn't so much he wasn't going to do fiscal stimulus. wasn't going to go for big infrastructure projects. what you really are expecting to
see is much more targeted short-term fiscal stimulus. something that ie disagree logically the treasury is comfortable with. road building programs small upgrades. rather big projects like high speed two, some of the widening, the lead in time is just too long to be sickically advantage tajs. >> what that meant for manufacturing and the trade balance now when you look at the euro after the ecb meeting yesterday, that should be additional good news for uk trade. is it not. >> let's not forget the globe in a whole is a currency war against each other and the uk has just take an leap in the last couple of months towards the front of the q in terms of currency devaluation. we expect that over the medium term to be been official for the current account. you saw the trade figures in the introduction. i wouldn't put too much weight
on the power of sterling over the long-term trying to get back to a balanced trade position. actually there's much more structural stuff in the nature of our relationship with europe going forward is going to be far more material in that context. >> it's interesting to note car lynn mentioned the survey coming in for expectation of a rate hike. it's hard to take about a rate hike at this time. it wasn't so long ago before the referendum vote we talked about when the boe would hike. >> we're talking about the next decade before you get a rate hike in uk. >> even if inflation goes well. >> correct. we're looking at inflation 3, 3.5%. in that backdrop, the bank of england would be ready to tightsen. sterling markets are expecting the next move to be down. that may be where we are. as the phony war ends and real negotiations start on the on
going relationship with the european. >> it's all very patchy. we're not getting more stimulus from the ecb at this point. to what extent even though the uk is moving apart, do they still depend on what's happening in the euro zone. >> the european and euro zone is still the biggest trading partner. 38% of trade. very material in terms of trade and the uk has been successful let's say in terms of changing that terms of trade through sterling depreciation. for the next two and a half years, you get unchanged trading relationships. actually that stands to benefit the uk. it's a real threat for draghi and finance minister. own country able to play in devaluation space and take advantages that draghi has been able to give the euro zone. >> do you think carney will take additional action at the next meeting or take a page out of draghi's book and wait here. >> it's going to be difficult to
take rates lower at the next meeting giving the upbeat data. i put some stimulus into the marketplace and see what the transition mechanism is first before taking other steps. >> and probably take credit for tall good data. that's how it works. >> absolutely. >> thank you so much for that. uk economist at panmure gordon. let's have a look at european equity markets. >> that's right. last day of the week here. happy friday everyone. sadly european equities are going out on a soft note. the misses, the drop we saw yesterday after draghi's comments. bringing the stock 600 negative on the week. seeing some declines continue. relatively modest losses at this gain. basically flat. xetra dax, french cac and italian ftse mib all off in the neighborhood. let's give you a closer look at the sectors one by one. oil and energy the big play on
wall street as we saw the dramatic 5% increase in oil. looking at a bit of a pair back in brent and wti off more than 1%. that explains weakness we're seeing in oil and gas off .50%. meanwhile banks moving .30%. you have to wonder if the less dovish tone could mean good news for the financials. >> that's maybe relief rally. and commerzbank report about that reshuffle there. also want to show you what's happening with u.s. futures this morning. s&p is down just 5 points. dow jones seen off by 28 and the nasdaq seen falling 12 points or so. this is after fell between 0.2 and 5% in yesterday's trading session. trading in a very, very narrow range. the nasdaq fell for the first time in five sessions. apple and tech weighing on the
sector obviously. the iphone did disappoint. staying in the u.s., hillary clinton took aim at rival donald trump for praising russian president vladimir putin calling trump's comments, quote, scary, adding it's the it suggests he will let putin do what he wants to do and make excusing for him. meanwhile donald trump doubled down on his critique of u.s. foreign policy. the republican presidential nominee blamed the formation of isis on america's iraq exit strategy and said the u.s. never should have sent troops to iraq in the first place. trump also took shots at the media which he called, quote, unbelieve blif dishonest. let's get out to nbc tracie potts standing by in washington. trac tracey, the foreign policy debate has become a more marked feature of this campaign race in the last few days. is this something we can expect to continue. >> reporter: you're going to see actually more of it this
morning. hillary clinton is pulling together some foreign policy and national security experts in new york to talk about terrorism issues. really trying to turn the page after that have forum this week and the fallout from it yesterday and a lot of talk about her e-mail today. she wants to try to focus more on national security and terror in the area where she feels her credentials are strong compared to donald trump. trump today is going after his party's base. he'll be here in washington at the value voters summit. it's a group congregation of some of the more con servetive members of the republican party focusing on things like religious freedom. going after those who have traditionally supported republican. sole really both of them after a pretty business and some degree controversial week. some of the comments about e-mails and comments at the forum wednesday trying to turn the page to focus on other things. hillary clinton was speaking to
national baptist convention taki taking a softer tone. talking about prayer and the african-american community how donald trump some of the things he said has been o if he saidive. not the right candidate to support that community. going into the weekend trying to change the agenda a bit. >> all right. . tracie, thank you for bringing that report. we want to bring you up to speed with flashes surrounding the north korea nuclear test. we are now hearing from u.s. defense department secretary saying to stay in close contact with south korea and other allies in the region. coming from the pentagon as reported by reuters. also the department itself saying north korea and nuclear test would represent a serious provocation and threat. we did hear from president obama as well as that said the north korea nuclear test demands serious consequences. >> meantime, u.s. secretary of state has arrived in geneva.
about a ceasefire deal for syria. previously announced nothing to announce for kerry's travel before quickly reversing course. coming up, we will be talking tech as sony gets set to release new gold plated walk man. what was wrong with the original. >> i like the gold plated walk man. >> who you may not like the sticker price. find out which gadget will set you back big time. stay with us.
team back from a 10-point deficit. thanks to 25 yard touchdown pass to anderson. brought the panthers within one point and missed a game winning field goal with four seconds remaining. >> i bet you were up late watching that one. i really wasn't. i'm more of a tennis fan. let's talk about tennis. look at this story, defeated top seeded serena williams in the seminy finals of the u.s. open preventing williams from winning record 27 grand slams. williams has held the number one ranking for 186 consecutive weeks. the top spot will now go to germany beginning monday. made in the u.s. open final on saturday. what a year it's been f.
serena williams is no longer unbeatable. >> definitely some good pictures. >> going to be difficult. our investors finding value in alternative assets. held classic car auction this week. cnbc reporter got under the hood to find out what's driving sales. >> reporter: with its reputation for showcasing pretijs items. this year did not disappoint. a meticulously maintained collection saw most of the deliver results. this blue 1995 g t2 which raked in 1.65 million pounds. doubles estimate. while james bond may have favored the later dv 5 model. that didn't stop this 1964 from raking in 1.2 million pound. one car failed to meet estimate was an austin princess from
1956. personally owned by beatle john lennon and featured in the hit video for imagine. different marks are enjoying mobile success. 2016 near 6% growth for classic cars major all. far cry from 490% by the asset class. what's driving the overall slow down. >> cars that are worse 200,000 are cracking million dollar marks. brought a krox women find reassuring. tells us sanity and real bedrock below this market. >> the despite the brakes being applied, what's still selling. >> a lot of younger buyers coming into the market. that's helping the 90s. the kinds of things these
collectors had hanging on their bedroom walls. we want to offer to them now. >> for more on the auction and how the classic karen mark iic been doing this year, head to cnbc.com. brian moan han told cnbc how he is handling the bank with potential scenarios. >> if you saw real yields quickly, somebody saw a view of the economy no one really sees and see that in a curve and all the estimates. nobody seeing a high inflammation yet rate haves to go up to choke it off. you don't see any economy in the
world let alone the u.s. economy. there will be a low probability of that. that being said, there is a probability so we plan for that and manage or company to be okay in all those scenario sgls wilfred also asked about the valuation of stocks with the markets at all-time highs. he thinks equities will go higher from here investors have no other choice. >> that's clearly that there's been low volumes. it's been a one-way trade. the question is experts sitting out there and other places telling me where is the money going to go with dividends exceeding sovereign yields. the money is going to go into equity marketing looking for return. complacency says we are missing something. it's clear the money is going into the equity markets because of the lack of yield and lack of return areas. meanwhile, wall street closed lower yesterday dragged down by apple. posted biggest one day drop since the brexit vote. shares closed down 2.6%. failed to cheer the launch of
the new iphone 7. wouldn't disclose first weekend sales raising concerns that apple may be cloaking the level of customer interest. >> another stock under pressure is twitter closed down nearly 6% after the board met on thursday for. >> reporter: all of this uncertainty isn't doing much for the company's stock. take a look. the shares ended the day down nearly 6% and the stock down more than 30% for the year. cost cuts are on the agenda, management is exploring ways to save money since revenue is tight. the options include possible layoffs or selling off assets. a source also tells cnbc that the management will not be questioned at the meeting and he will have a few more quarters to execute turn around plan which revolves around live video. also speculation about a possible sale of the company, but no bids on the table. possible buyers could boost
twitter's reach include, google, alphabet, microsoft and sales force and for now twitter is focusing on the partnership with nfl starting the live stream game a week from today and hoping to boost user growth. company declined to comment on the board meeting. meanwhile, sony has slapped eye watering 3,000 dlarl price tag on gold plated walk man. weighing in at one point, the portable music laumpked on october 29 in japan. let's bring in managing director. thank you for joining us this morning. so much to talk about in sector. since we've been going big on the walkman, let's get you views on the company. disruption tied to the earthqua earthquake. on the gaming front overshadowed
by nintendo and pokemon craze. >> how resilient the company has been in all this bad news. in the end, we are always looking for disruptive technologies and the companies behind it. there's little doubt the ps 4 is turning into a disrupter technology. not only is it taking over the whole counsel gaming space, default in the leving room. sony is already the biggest distributor for netflix. has their own internet tv program in the state. now they're going to be the cheap entry point for virtual gain. >> looking more broadly we had a few names hitting all time highs. nasdaq hitting a new all-time high. do you think there's still room to invest in some of these names. >> i think so. the market caps of some of these stocks are getting eye watering
high. so is profitability. when we had facebooks results about a month ago, this is a company with 350 billion valuation. yet you're still looking at 40% earnings growth coming through and valuations on a 12-month rolling basis of around 12 times operating profit. which is very attractive. that's why, you know, in a flat market overall, it has been stocks like facebook which have been moving ahead. >> what about apple though. we saw disappointment in the stock seeing the biggest fall since brexit on the fact the iphone 7 didn't blow anything out of the water. do you think apple is at the end of its game. >> i think apple is changing the game. i think the days of counting the number of iphones being sold is close to coming to an end. apple's focus is on what you do with the iphone. how you spend your money on it.
obviously apple payers are a lucrative long-term source of revenue. when pokemon go came out, the biggest winner of that game was probably apple. it's behind that story you have to be careful when you get too nervous about launch sales of the iphone 7. the iphone 5 had a terrible reception. that didn't stop apple shares doing well over the next 12 months. >> i know you like the tech companies. some people could argue they're not innovative and nimble. wouldn't you want to go with mid size companies because they're strong when it comes to innovation. >> i think the tech sector right now as i said, you can either plump five of the six largest names on wall street are tech stocks now. you would go big or go small. in the case of sony, people forget it's only a $40 billion company as opposed to 300, $400
billion. if you want to make ten times your money, look at sony as opposed to the bigger players. >> what are your thoughts on a. who will be the leader. >> i don't think there's going to be any one leader in the ai. the companies who have been putting a lot of money in it at this point whether it's the likes of facebook and google on one end and ibm and microsoft are probably going to be the ones. obviously investment opportunities companies that use ai are going to be interesting. >> do you think it will be a catalyst for more ma in the sector. >> i think so. particularly if you can find a company that spends cash and has a product and be able to sell it. there's going be a lot of that. >> thank you for joining us. managing director. quick look at the european equity markets before we let you go. and before we wrap up and it's our weekend very soon. the ftse 100 is down just fractionally by 0.1%.
the xetra dax off a similar amount. certainly risk eversion in the margts this morning on the back of north korean nuclear test. lingering disappoint over draghi and trading session. sector wise looking like this. bank still outperforming to the tune of 0.8%. deutsche bank making a splash once again. insurance autos doing better on the downside we're seeing retail construction and material. >> on the week we should point out this makes stock europe 600 negative for the week. that will break a two-week winning streak. meanwhile, let's bring you to speed on oil. without a doubt that was driving trade overnight. pairing back slightly. we did get moves near 6% higher yesterday. this was on a surprise draw down in u.s. stocks. some people were quick to say don't read too much into it. some due to tropical storm. hurricane hermine causing
disruptions. nevertheless, it will move direction in the session today. >> the energy market in the u.s. was the best performing sector this week. up 4%. again, it is so volatile. quick look at the markets. we're seeing euro dollar still above 1 .12. one again, it's all about draghi's disappointment yesterday. giving you a check at how u.s. markets are set to open. s&p called lower 6 points and dow jones called lower 30 points. that's it for our show. i'm nancy hungerford. >> i'm carolyn roth. "world wide exchange" is up next. have a fantastic weekend. it's scary when the lights go out. people get anxious and my office gets flooded with calls. so many things can go wrong. it's my worst nightmare. every second that power is out, my city's at risk.
this is the new comfort food. and it starts with foster farms simply raised chicken. california grown with no antibiotics ever. let's get comfortable with our food again. good morning. breaking overnight, north korea tests nuclear. could be shocked by the fed. jeff gunlock latest comments including why it's dfrsive on bonds. plus scores and more. if you went to sleep early, you miss the broncos hanging on to beat the panthers. we'll bring you the highlights of the nfl season opener. it's friday, september 9, 2016 and "world wide exchange" begins